USDINR opened at 74.32 on Friday and the pair traded in the 74.11-74.36 range. Spot USDINR closed at 74.12, loss of 12 ps USD as against prior close of 74.24. RBI reference rate was fixed at 74.27 on 01/10. Oct USD/INR closed at 74.29, loss of 20 ps for USD as compared to prior day’s close of 74.49. Oct Euro/INR closed at 86.20, GBP/INR at 100.58 and Yen/INR at 66.86. USDINR fwd premia was trading at around 4.40% p.a. FX reserves stands at USD 640 bn. RBI seems to have sold USD through PSU banks to cap Rupee weakness at 74.35.
Rupee lost 1.7% in Sept to close at 74.26 as against Aug close of 73.
|PAIRS||RBI REF RATE (01/10)|
In Sept, FII’S have net bought Rs 7662 cr in Equity segment and have net bought Rs 11523 cr of debt. In this financial year, FII’S have net bought Rs 5287 Cr worth of Indian Equities and have bought Rs 19388 Cr worth of Indian debt. In 2020-21 financial Year, FII’S nett bought Rs 2,74,203 Cr of Equities and have sold Rs 42820 Cr in debt.
Benchmark Nifty declined 0.49% on Friday. DOW climbed 482 points (1.43%). Nikkei was down 2.31% and Hang seng declined 0.36% on Friday.
Euro closed the week at 1.1593, Pound at 1.3546, Yen at 111.07.
Commodities: Gold is now at USD 1761 and WT1Crude at USD 75.72/Brent at USD 79.10.
Interest rates: USD 10 Yr yield is at 1.46% and 3 m libor closed at 0.12%. Indian 10 yr benchmark yield closed at 6.24%.
Economic news: Indian PMI (mfrg) climbed to 53.7 in Sept from 52.3 in August. The growth in September was backed by stronger new order inflows, and companies scaling up input buying to accommodate rising sales and progress with production schedules. The uptick in input buying came on the back of anticipation that production would increase in the year ahead.
India recorded USD 6.5 bn current account surplus in Q1 FY22. This is apprx 0.9% of GDP. In Q4 21, deficit was at 1% of GDP. Capital account recorded surplus of USD 25.8 bn in Q1 FY22. This is against USD 12.3 bn in Q4. FDI inflows contributed to capital account surplus.
GST collections climbed to 1.17 trn in Sept.
Japan’s Tankan large manufacturing index rose from 14 to 18 in Q3, above expectation of 13. Large companies expected to expand capital investment by 10.1% in this fiscal year, risen from prior indication of 9.6%.
Data highlights: – US Personal income climbed 0.2% m/m, spending grew 0.8% m/m, Core PCE Index climbed 0.3% m/m.
-US ISM(mfrg) climbed to 61.1 and Construction spending was flat m/m.
-EU PMI(mfrg) was finalized at 58.6, German retail sales dipped to climb at 1.1% m/m, CPI climbed 3.4% y/y.
Monday’s calendar: – US factory orders
-EU Sentix investor confidence.
Daily Support/Resistance table
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
Technicals: Spot closed above 50 and 100,200 day major moving averages.20 day moving average is at 73.67. 50 day moving average is at 73.95.200 day moving average is at 73.58. Daily MACD is in buy zone, implying bottom at 72.92. Important resistance is at 74.35/74.60 and important supports are at 73.93/73.82/73.74. Spot closed below its average level of the day.
Intraday supports and resistances for Oct contract are:
PP: 74.36 S1:74.18, S2:74.07, R1:74.47, R2:74.65
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USDINR Imports hedging can be done at around 73.85/73.75.
Exporters can hedge EURINR receivables exposure at 86.50.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is below 50, 100 and 200 day moving averages. Major resistance is at 1.1660/1.1765. Next major support is at 1.1510. Daily MACD is in sell zone, implying an important top at 1.19. Weekly MACD is in sell zone, implying important top at 1.2270.
GBP/USD: The pair is below 50 and 200 day moving averages. Daily MACD is in sell zone, implying important top at 1.39 and weekly MACD is in sell zone, implying important top at 1.4240. Important support is at 1.3410.Important resistance is at 1.36/1.3735.
USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 109.10. Next important resistance is at 112.80. Important support is at 110.80/110.45.
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